Huge smartphone supply chain producing small, cheap, low power components enables new products like drones, wearables, and other connected devices
The home and the mobile supply chain — For the last 30 years PCs and the PC supply chain dominated the technology industry … Tweets: @gassee , @pmarca and @dsaezgil Tweets: Jean-Louis Gassée / @gassee : @BenedictEvans: “hardware has lapped software” What the mobile supply chain has wrought http://ben-evans.com/... Marc Andreessen / @pmarca : The peace dividend from the smartphone wars = amazing sledgehammer impact on hardware supply chain: http://ben-evans.com/... Diego Saez Gil / @dsaezgil : “It's the intelligence and the software that makes the difference between a commodity widget and something of value” http://ben-evans.com/...
Context & Ripple Effects
In early 2015 Benedict Evans argued that after 30 years of the PC supply chain dominating technology, the scale of smartphone manufacturing had become the industry's real center of gravity — tiny, cheap, low-power components pouring out at volumes no PC-era ecosystem ever matched. The piece circulated widely among operators: Jean-Louis Gassée amplified Evans's line that "hardware has lapped software," while Marc Andreessen framed it as the peace dividend of the smartphone wars hitting the hardware supply chain like a sledgehammer.
The essay reads as the opening claim of an arc this page's own coverage tracks forward: Chris Dixon's 2016 case for cheap smartphone chips and sensors embedded in everything converging with open-source AI as the next computing wave, Evans's own "Mobile is eating the world" update sizing the installed base at roughly 2.5 billion phones reshaping retail and cars, and Shenzhen's move from contract manufacturing into sophisticated hardware-software-AI products. The throughline: whoever owns high-volume component manufacturing sets what gets built next.
First-order effects
- Startups building drones, wearables, and connected devices get access to sensors, radios, and processors priced and sized for billion-unit phones, collapsing the capital barrier that previously favored PC-scale incumbents.
- The PC supply chain loses its role as the technology industry's default component source, as phone-volume economics undercut it on cost, size, and power draw.
Second-order effects
- Shenzhen manufacturers, having mastered the smartphone bill of materials, climb the value chain from making parts to shipping finished products where software and AI differentiate otherwise commodity widgets.
- PCs begin absorbing phone-industry traits — power-efficient CPUs, thin designs — a reversal of the old direction of innovation that later accelerated with 5G adoption.
Third-order effects
- If the pattern holds, each successive computing wave inherits the smartphone supply chain rather than building its own: the same Korean, Taiwanese, and Chinese component base that armed the drone-and-wearable era is the one positioned to supply the AI boom, with US-China curbs deciding which suppliers capture it.
- Hardware advantage migrates from owning a proprietary architecture to commanding volume manufacturing, making supplier geography — not chip design alone — the structural constraint on future device categories.
The trend: Every computing wave since the smartphone — wearables, drones, IoT, and now AI hardware — has been built on the smartphone supply chain's component volumes rather than a successor manufacturing base.